I am a CPA in Texas with an MBA from the University of Chicago. I have seen a lot and made many mistakes. Hopefully by now I will have learned something from them. Just as importantly, you may learn something from my mistakes. You can e-mail me by clicking on my "View my complete profile".

Saturday, January 9, 2010

Encouraging Zimbabwe Ben

"There's a good chance that unemployment will rise, not fall, over the next year. But even if it does inch down, one has to ask: Why isn't the Fed trying to bring it down faster? ... You can't just look at the 8 million jobs that America has lost since the recession began, because the nation needs to keep adding jobs--more than 100,000 a month--to keep up with a growing population. And that means that we need really big job gains, month after month, if we want to see America return to anything that feels like full employment ... So if we're going to have any real good news, someone has to take additonal responsibility for creating a lot of additonal jobs. And at this point, that someone almost has to be the [Fed]. ... Joseph ... Gagnon urges the Fed to expand credit by buying a further $2 trillion in assets. Such a program could do a lot to promote faster growth, while having hardly any downside. So why isn't the Fed doing it? ... Meanwhile, a significant number of Fed officials, especially at the regional banks, are obsessed with the fear of 1970s-style inflation, which they see lurking just around the bend even though there's not a hint of it in the actual data", my emphasis, Paul Krugman (PK) at the NYT, 11 December 2009, link:

PK resurrects the Phillips Curve here. If Uncle Miltie proved anything it is: inflation is always a monetary phenonenom. PK wants Zimbabwe Ben (ZB) to double the monetary base again, which ZB more than doubled over the last 18 months! If you have US dollar bonds, sell. Imagine, PK holds a Nobel Prize. What a farce. PK, why is the US population growing? Could the US reduce its population growth? Hint: end illegal immigration.

It isn't just illegal immigration. What incentive to those who milk welfare and project housing is there to stop popping out children? Don't they get extra money per kid? If anything, they are rewarded for reckless reproduction. 1,2,3,4,5,6... think about it, after awhile it seems like the perfect scheme: just squeeze out more useless children and get a "raise" from Uncle Sam every 9 months.

Junior:Your point is well taken. Mexicans' fetility in the US is higher than in Mexico. Richard Hernstein wrote about "differential fetility" in the Atlantic in about 1989. Unless our welfare system collapses, "reckless reproduction: will continue.